THE Perth property industry is starting to feel optimistic following that latest release of data.
Prices increased 0.1 per cent in January according to CoreLogic.
It may be a very small change but follows on from a 0.4 per cent rise in November and no decline in December.
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READ NOWIn addition prices are up 0.6 per cent over the three months to January, after bottoming last October.
Reiwa president Damian Collins said it was pleasing to see prices stabilise or increase for three months in a row.
“Breaking it down into houses and units, reiwa.com data shows that the median sale price remains at $480,000 and $375,000 respectively for January,” he said.
First-home buyers also appeared to be taking advantage of lower interest rates, with a greater proportion of sales, about 30 per cent, occurring below $350,000.
Overall sales activity and the number of properties for sale remained stable in January, but one in three suburbs recorded notable improvements.
“The top suburbs by sales activity growth include Leeming, Dianella, Woodvale, Ellenbrook and Secret Harbour, while Halls Head, Canning Vale, Baldivis, Secret Harbour and Dianella had the highest number of sales for the month,” Mr Collins said.
“Feedback from agents on the ground is fairly positive, with good quality stock being snapped up quicker, and the amount sellers are discounting reducing to 6.4 per cent.
“This is a positive sign for the median sale price and if this continues, we should start seeing a gradual increase in prices in the coming months.”
While the early signs are good, there are still factors that could hinder a hoped-for recovery.
Speaking to Residential Mr Collins said population growth and tax policies could affect the market.
“Population flows are an important driver for the housing market and arguably the single biggest demand factor, quite simply because the more people there are, the more demand there is for housing and competition increases, forcing prices to go up.
“In 2020, we expect that population growth will likely remain soft unless the economy can create jobs to attract people.”
Mr Collins said at a state level stamp duty was an ongoing barrier for people looking to buy property or trade up and there would still be uncertainty over negative gearing and capital gain tax until Labor ruled out any changes ahead of the next election.
“Moving into 2020 with somewhat high hopes, the government needs to be careful of meddling with such tax policies,” he said.
“Negative gearing is a healthy incentive for investment, and if removed could have serious consequences to our property market recovery.
“Stamp duty remains a big reason why people aren’t active in the property market, and if the government continues to overlook any reform to stamp duty hopes of a market recovery could be prolonged.”
The Perth rental market saw leasing activity increase 26 per cent in January.
“Leasing activity typically increases at the start of the year, whether it is part of a tenants New Year’s resolution to find a new home or simply getting back into a routine after the festive period, which is why we have seen the jump in leasing to 4,608,” Mr Collins said.
“The five suburbs which experienced the biggest increase in leasing activity were Como, Southern River, Kardinya, Waikiki and Safety Bay while Baldivis, Canning Vale, Halls Head, Clarkson and Butler had the most number of properties leased.”
There were 5840 properties listed for rent at the end of January, up 4 per cent on December but 13 per cent lower than the same time last year.
Mr Collins said the decline in listing over the past 12 months had a significant impact on the vacancy rate, which remains at a low of 2.4 per cent.
The median weekly rent was unchanged at $350 per week.
